6 ms·

Protect Kids, Get F*cked

136 points by sabraham 14y ago

sabraham 14y ago
This sounds like the story Jessica Livingston mentioned at Startup School 2012 <http://news.ycombinator.com/item?id=4699862 http://news.ycombinator.com/item?id=4699862 >, if I remember correctly -- business in Texas got a term sheet, moved to California, investors pulled out when their user acquisition metric changed. Anyone have more color on this?
- pg 14y ago
  Yes, this is the same story.
- antonID 14y ago
  I thought I had remembered this from Startup School, interesting story.
russell 14y ago
The real lesson is that the money isnt there until the check clears. Selling your house and moving on a promise is risky. Even trying to raise money is a huge drain.
mtaubman 14y ago
Somehow I feel that a more accurate title would have been, "Fail to meet agreed terms, screw yourself".
GuiA 14y ago
The title is a bit disingenuous, but the story is worth reading. Thanks for taking the time to write and share, Jason.
- klawed 14y ago
  It's charitable to say that the title is a bit disingenuous. I agree that the story (as well as the ongoing discussion) is very much worth reading. The unnecessarily provocative title is only slightly distracting.
thoughtcriminal 14y ago
The title is misleading, immature and in poor taste. If HN moderators had a clue, they would edit it.
- mkr-hn 14y ago
  You mean the moderators who routinely revert titles to the target page's title when the submitted title is better?
- largesse 14y ago
  I too am outraged. I nearly lost my monocle.
- andyjohnson0 14y ago
  If you had the power to edit it yourself,what would you change it to? And why?
  - thoughtcriminal 14y ago
    "Misadventures in Kiddie World" Anything is better than what's up there now.
jere 14y ago
As an old teacher of mine used to often say, "Check's in the mail. Love you in the morning."
michaelochurch 14y ago
We went back to other investment firms that we had also received term sheets from prior to committing to Benchmark, but after Benchmark pulled out, the news spread and we had the scarlet letter, or maybe the scarlet zero. This is why VC-istan is dead. (Not actually dead, but "Microsoft is dead" dead.)
jpatokal 14y ago
Let me just quote one bit of that: Our service was free as we were working out the business model. We actually had a genius business model but hadn’t implemented it yet. We wanted more users so we spent money on marketing. Maybe the real problem wasn't the insurance?
- batgaijin 14y ago
  The money was in the bank, man.
- tptacek 14y ago
  No, the real problem wasn't insurance; it was that a firm-seeming commitment to fund the company fell through at the worst possible moment. A lawsuit wouldn't have fixed anything for them; it'd have taken years to resolve.
  - joewee 14y ago
    They would have been in a much better position if they had actually turned on the revenue model before asking for money. Without that, the only metric they had to impress investors was user acquisition which was dropping.
    - tptacek 14y ago
      Or he'd be in a much worse position, because his cost of customer acquisition was high and the money he'd earn from charging wouldn't come close to covering his operating expenses, and charging would slash his new user signups, which were probably the only realistic lead gen he had to work with. Which is, you know, the situation that gets most people to consider venture capital.
      - jpatokal 14y ago
        Sure, if the "genius business model" was "charge everybody money for it", but the way that was phrased implied they had something more devious in mind. By going the VC route and asking for $7 million straight up, they bet big and lost big.
rdl 14y ago
They (Benchmark, a top-tier VC) broke a term sheet? That is...not awesome.
rdl 14y ago
It looks like failure to get D&O insurance prevented them from suing a top-tier VC for breaking a term sheet, but it's unclear how wise it is to sue a VC over something like that, anyway. BTW, if anyone needs commercial insurance for their (California based) business, I've had pretty good experience with http://www.alliedbrokers.com/ http://www.alliedbrokers.com/ Allied Brokers in Palo Alto, so far. Prof liability, D&O, etc. are all things which are probably worthwhile after a >$1mm seed, depending on how litigious your sector is (b2b, particularly).
jlangr 14y ago
I suspect people who really want to "protect kids" find a way to do it that doesn't involve greed, lawyers, stupidity, and liberally cursing. Maybe there wouldn't be as much need to protect kids were there fewer people who talked about "getting f*cked" or screwed when talking about kids. Jerk.
- tptacek 14y ago
  As a parent of two middle schoolers, I am a lot less worried about adults using adult language to talk about business than I am about the people who can't tell the difference between that and actual threats to my children.
  - jlangr 14y ago
    Whatever. Just another guy who thinks he's owed something because he did something that he thinks everyone should be gushing over.
    - tptacek 14y ago
      Yeah. Stupid guy talking about his stupid life experiences. He should grow up.
  - morphle 14y ago
    Please describe these actual threats to your children that you claim. As the first public internet provider in my country we encountered many of these 'actual treats' claims or 'child pornography' witch hunts but we never found a shred of evidence to support them.
- vacri 14y ago
  Such liberal cursing - saying 'fucked' once. To hell with your overbearing conformance, I say.
tptacek 14y ago
What a shitty situation. But why, oh why, would you sell your house and move from Houston to California before the check cleared? We started Matasano when my kids were pre-K and a a full-day every-day handful, and I had to spend a couple months away from my family while we worked out the move (mine from Ann Arbor to Chicago). I know I'm not the only founder to deal with that situation. Was there some additional circumstance involved here, some other pitfall people should be on the lookout for?
- RuggeroAltair 14y ago
  I know directly of one case in which one of the terms of the acquisition was that in case of the founder's death within the retention plan, his family wouldn't get the remaining part of the money (which would be given at the end of the retention plan only if he was still alive). This founder, rightly so, thought that it was an awful concept, since his kids needed to be protected exactly in the case of his death. The purchaser said they would have not changed the contract since that was a standard clause and that it was unconceivable to consider changing it. The startup called everything off the day before the deal (even after it was announced), because of this. The clause that was impossible to make disappear suddenly disappeared overnight. P.S. Congrats for Matasano, I am a fan of your company.
  - danielweber 14y ago
    was a standard clause and that it was unconceivable to consider changing it The clause that was impossible to make disappear suddenly disappeared overnight Oh, if I had a nickel. Younger readers (and older ones, too) should be aware that this is one of the easiest lies to slip from someone's lips: "oh, that's standard, we can't get rid of it." You need someone experienced on your team -- even if not working for you, a friend you can call -- to find out just how "standard" these things are. EDIT: even terms that really and honestly are "standard" can be changed
homosaur 14y ago
While you made a lot of mistakes here, it's also pretty frustrating that there's a good deal of VCs who are basically only looking for the next Twitter. Why would anyone think viral growth would be realistic for this product? How does one acquire that much capital while knowing so little about business?
- brazzy 14y ago
  A good deal? From what I've heard, every single VC in Silicon Valley shares this unhealthy obsession over "the next Twitter" (Just read pg's definition of "startup"). And as long as Twitter, Google and Facebook keep paying 8 figure (or 10 figure) sums to acquire "startups" without a business model, VCs don't need to know anything about real business.
  - homosaur 14y ago
    Well, I was trying to be nice so the ones that read the forum can convince themselves they are in the good group.
jessaustin 14y ago
Wow that really sucks. In hindsight, could you have hit up your current investors for the bridge round before shopping around the Valley, or would that have put VCs off too?
- BrandonWatson 14y ago
  As one of my favorite private equity friends likes to say, "a bridge to nowhere is a dock." We were offered some additional capital but it wasn't enough and our conviction was smashed. Until you've been in this sort of situation, you can't know how you will feel or react. Experience is a great teacher.
stuffynoses 14y ago
We received email after email from parents thanking us for saving their children’s lives, literally. Yes, please tell me more about all these children whose lives your service saved. Just like To Catch A Predator's ridiculous premise (that digusting, fat 50 year-old men who live in their parents' basement are hooking up with hot teenagers), yours reeks of trumping up a problem that only exists on the extreme fringe. Literally. one of the partners installed our software. He tested it, he used it, it worked. He got it. He called us and said he wanted to invest as soon as possible. Who is this investor? I want to know because anyone who would vote money on an anecdotal experience like this is an idiot. Your story is interesting, but only when it sticks to the parts about you rushing into an investment without due consideration or self-protection. If you wanted funding, you should've asked Congress for it. They love to exaggerate child sex exploitation as much as your service did.
- morphle 14y ago
  Indeed, tell us more about these children's lives you saved. I've done extensive research on these occurrences when my first startup internet provider first encountered these claims in the nineties. We never found any evidence whatsoever. We did find an overwhelmingly large number of people ready to go on a witch hunt or lynch these so called perpetrators, but that's been going on for thousands of years now. Has anyone claiming child pornography online ever actually found something? Again, please show us, they would be my first datapoints ever in our assisting of the police in investigating these. The business model of the OP is itself predatory on the fears and underbelly feelings of uninformed parents. Better to explain to those parents how to raise children so that they are cautious about anything they encouter online.
  - steevdave 14y ago
    I used to work for a content filtering company. Yes child porn exists, and it's one of your worst days when these sites start popping up in what you're reviewing, no, we can't send the links to others to "prove" it exists. I no longer work there and I'm glad I don't have days like that anymore.
  - zurn 14y ago
alphakappa 14y ago
It's a good lesson on how not to make poor business decisions, but the number of times the writer repeated the 'protect kids' phrase turned this into a really tough read. This wasn't a noble mission thwarted by evil VCs - simply a cautionary tale of how not to make startup decisions.
caniszczyk 14y ago
He got lucky that he was able to bounce back.
- BrandonWatson 14y ago
  Jason didn't get lucky. He's incredibly talented. We, as a team, failed. It happens. I would go to war with any of my co-founders again, no doubt.
erik_landerholm 14y ago
I can add a bit more color to this story as I was intimately involved in it. I worked at the company that was bought by HP in Oregon and then later in Texas. It was called RLX technologies and created the first blade server. After it was purchased by HP I stayed on for a few months before moving on to a startup in Oregon. It seemed like a great idea as they moved me back to Oregon. My best friend, who got me on at RLX after my first startup (NEI: high speed telecom startup) had crashed and burned, had taken a position at this startup in Oregon (we both were from there and had met after graduating from Oregon State). It seemed like a way to continue the work we had started at RLX and would get me back to Oregon. So win-win. Long story short: the startup had issues and he moved on to found IMSafer. I would of liked to but needed to stay on for another 6 months, so I wouldn't have to pay back half of my moving expenses. Once I finally moved on to IMSafer the company was still small with only 6 of us. It was a great time and we built something truly exciting and helpful. We had a wonderful time at the Techcrunch 40…, but that's a story for another time. :) I believe Paul knows this story too, as it was one of the big reasons we got into Ycombinator! I will skip to the end as Jason supplied much of the interesting info and the color to that debacle. But, I will add, just as you don't count your chickens before they hatch you never, never invite your new 'partner' (board member, investors…whatever) to a board meeting until the money is in the bank. Once the assets were sold only 2 of us stayed on with the new company that bought us. It was a trying time, but my best friend did get to move back to Oregon and it was just us, keeping a rather complicated site up and running while working on creating the 'new' product that was to make all the money. While, at IMSafer we had realized that there could be big money in using this software in a more enterprise fashion. We realized that many virtual worlds for kids were popping up and they had use for software like this. He, I and another one of our friends from our old RLX days set out to create a real-time piece to the software that was much better at moderating less dangerous content like curse words, etc. It would quickly mark words they found objectionable and pass the text on to the more complicated software outside their enterprise to look for the truly dangerous things. From the point that IMSafer crumbled to when he and I decided to leave or got fired…depends on who you are asking, we had grown the business to a million dollar run rate in 8-9 months. But, we had been bought by a startup and we had very different opinions on how to run it with the purchasing company…and we lost! About that time we left/got fired we decided to do something new. Both of us had vary different experiences buying a new car and decided we wanted to fix that. After getting in a small fight with our former employees we got them to relinquish all rights to CarWoo! and proceeded to build it. At the time it seemed a bit crazy to fight for something that wasn't much more than a landing page and a bunch of crazy ideas, but in hind sight…seems like genius….I have decided to tell it as a stroke of genius! After we got into Ycombinator we told Paul about this story and at the time he said it was the worst 'pulled funding' story he'd ever heard. It's possible he's heard worse since, but somehow I doubt it. 5 of the 6 of us were married at the time and 4 of us had children. As we were in the tussle over CarWoo!, which was almost nothing at the time my wife had our second child. Tommy and I got our call that Ycombinator had accepted us while sitting in benchmark's parking lot in the spring of 2009. We had come full circle i guess you could say. We moved down to Palo Alto, left our wife and kids behind for the time being and the rest is history.
mratzloff 14y ago
I'm confused. Did they protect kids? I don't remember if he said that or not. Anyway, a few comments: - They paid for free users with no business model in place - They failed to complete requirements of their previous investment deals - Handshakes don't matter, term sheets don't matter; nothing matters until the check clears
- rexreed 14y ago
  Startups should print out those last three bullets, frame it, and put it on the wall. It would save a lot of heartache.
- BrandonWatson 14y ago
  We had a business model. We knew when we would start charging. We were already testing pricing when the VC round was underway. We did not get the D&O. That was as much a legal representation screw up than my own failing. I was the CEO, so the ultimate blame lays at my feet. Term sheets don't matter, but one thing that is getting lost in all of this is that we had definitive docs. We had been given keys to the VC office to take up positions as residents until we had office space. Money from other investors was already in escrow. It's not like we got a signed termsheet and moved. We signed the termsheet in Sept, moved through definitive docs until Nov, and it all fell apart in mid-late Nov. It sucked.
yarou 14y ago
I really enjoyed reading this article. More articles like this need to be on HN, rather than the run of the mill startup success stories. It's refreshing and visceral to hear how a startup can fail, being so close to success.
paupino_masano 14y ago
I know how you feel exactly. I had a business in the same position except in the payment industry: we were processing roughly $1m a day until one day we had a frightening call from the bank. Two weeks later we were in liquidation and I was facing bankruptcy. Like you are saying (in an essence): the rug was being pulled from under you. Thank you for sharing your story - by sharing, it it helps the whole startup community :)
Zak 14y ago
Age? Sex? Location? That’s how predators started their hunt. It's also how teenagers started conversations with each other in chat rooms a decade ago. It may still be, but I haven't been a teenager in a while. I imagine predators open with the same question, but actually using it as a filter would produce an unacceptable amount of noise. This is a useful story about some of the mistakes one can make dealing with VCs, but it sounds like the product itself was a little questionable.
- altcognito 14y ago
  Not really. The default mode is to be skeptical today of anyone online, and that there is no need to provide this information in an online conversation.
- mnicole 14y ago
  In reading the article and thinking back to being a kid who'd create free-trial Juno accounts and dig through drawers to find the Post-It notes that my parents' AOL accounts' passwords were on just to spend hours talking to strangers on the internet because it was exciting, I have to agree with the notion that this software rubs me the wrong way. This is an issue of parenting; you can't just turn on an app and expect it to do your job for you. Kids won't be dumb if you treat them with respect and show them what can happen if they don't keep their eyes peeled. Like the ridiculousness of the Dateline conversations, it was always very obvious when someone was creeping on me and it only took one click to block them. Allowing my already-fearful and ignorant parents to read random snippets of messages I was sending and receiving - particularly because a lot of our ASL?? comments were jokes to begin with - is a violation of my privacy and trust. Growing up in an environment like that would have completely shifted not only the way I use the internet today (especially if they'd gone ahead with their plans to implement it in social sites for kids), but would have affected my relationship with my parents in ways that would have left me hesitant to be myself at all. Worse, when my cousins reached those ages at around the time this company was starting, social mediums had progressed and their problem wasn't talking to people online; it was posting very promiscuous photos and embarrassing YouTube videos showing the inside and outside of their homes and not putting any privacy barriers up. Those are much bigger concerns to me than knowing how to deal with stranger danger in text communications.
aaron695 14y ago
Lol totally evil product based on making people lives awful through fake fear. But I guess that's many successful products, make people feel bad or their lives are missing 'something' and give them the solution for the $ Myself and friends have often talked about it. Be unethical but make money. Individual vs Herd mentality. And in the first world is it really that evil to fool the people who fall for it? I find it hard personally but maybe that's a weakness I should train to get over, not sure. I do give a % of my wage to 3rd world charity so would I still be up positive ethics wise. Interesting article to see into that world anyway, something to think about.
Tichy 14y ago
"For almost two years they had been personally liable for what me and my friends were up to." I don't understand this part. Shouldn't the investors have seen the insurance through themselves? It seems mad to rely on other people for that kind of thing. Sure it would have been nice for the startuppers to organize it, but really, it's a no-brainer that for such things you have to organize it yourself (because the people tasked with it have no real stake in it).
jiggy2011 14y ago
Doesn't sound like they had any idea how to make money off this thing. Since for whatever reason they decided they didn't want to charge any money for the service. What could they have done to make money from children's internet chat logs that would not be in some way shady?
rexreed 14y ago
Talk about counting your chickens before they hatch ... and not just about the part where they moved or added a board member before the money hit the bank account, but even the little "celebration" in Vegas. How is raising money a reason to celebrate in Vegas... especially when it hasn't even hit the bank yet? While I feel bad for the founders here and the VC behavior is deplorable, a little cautiousness and common sense would have really saved the day here. "Let's not move until the money is in the bank, ok? Hey board member -- just step back for a few minutes until the wire clears. Once it does, we're all yours." ... All that being said ..... BIG KUDOS to the team for getting the investors their money back: "We sold the assets for what our original investors had put in to the company, about $1.5 million, so we were able to give them their money back." That's great -- I know very few entrepreneurs who have gotten well past the point of raising capital who can claim to have returned investor money. So, while you might have gotten the Big Screw by VCs, in part due to their shadyness and in part due to your own over-enthusiasm and lack of diligence, I think you saved the day for your investors. They may not invest with you again, but they can't say they lost money with you either.
appleflaxen 14y ago
A bit off of the main point, but > Age? Sex? Location? That’s how predators started their hunt. And how non-predators start their hunt (the same way that predators in the 1800s started their letters with "Dear Timmy"). It's a completely nonspecific starter question for anyone who is chatting with a stranger, and I wish the author were more careful with this.
DanBC 14y ago
Perhaps there's a niche for software that alerts the children and not the parents when they're triggering certain flags. "Do you really know this person AFK?" "How would you feel if this photograph was sent to all of your teachers, and everyone you know in school?" And before people mention MS Office's Clippy - yes, it was was awful, but part of the reason for that was kludged implementation. (http://robotzeitgeist.com/tag/bayesian-inference-engine http://robotzeitgeist.com/tag/bayesian-inference-engine) This new implementation could have a "spy on your children" feature, but allow that to be turned off for the parents that find such things troublesome, allowing the warnings to go direct to the children.
BrandonWatson 14y ago
When Jason sent this to me as a preview, I did not think it would end up on HN. Interesting. I want to respond to a few of the comments, as I was the main protagonist in getting this idea off the ground, CEO of the company, and the business/product guy surrounded by the talented engineers who made this happen. The decision to invite the board member on to the call the day before the money was in the bank was my call. My biggest mistake of my career. I have learned from it, but it was my call and I blew it. Nothing about the situation gave us any reason to believe that we would have a problem. By the way, if anyone wants a front door key to a tier 1 VC firm, I am sure one of us still has theirs. On the topic of the business model. Let's first talk about the derivation of the idea. Having spent my career in tech and Wall St, I have seen the migration of high IQ talent into spaces where the marginal utility of IQ was trending to 0. We wanted to find an opportunity where we could be smart and do new things, and that would, theory lead to money. The base thesis here was that no one had made money in the kid protection space for a while. IQ follows money. Viola. We were right - there had been no innovation in this space in a long time, and everyone was focused on keeping porn off computers. We decided to try and focus on keeping bad guys from getting to the kids. We can all have an intellectual discussion about whether this was an overblown social issue or not. I don't feel like rehashing that here. What we did know is that we had a novel approach to solving this language problem, and we built an engine. We did not solve it with Bayesian analysis or ML. We went a different route, and the engine was very effective. Our premise was that we could sell the software to parents. We did all the things many of you would do. Built an MVP (before there was a phrase for it), talked to customers, etc. It turns out that the axiom from real estate is true here. People lie. What parents said they would pay for, and how they reacted when using the software were totally different. Many of them expected the software to come with a computer, or be paid for by someone else. They told us they would pay for it, but in reality they expected it to come from an AV provider. That never would have surfaced in talking to customers ahead of time. We then pursued a deal with McAfee. I don't know if at this point in time I can talk about that deal or not, but suffice it to say, that wasn't the golden ticket. After spending time refining the business model to get parents to pay, we (as many companies do) fell backward into our business model. It started with a fortuitous call from a large company making a massively multiplayer game for kids. It turns out many of these companies who cater to kids have rooms full of moderators for in game chat. People are very expensive. Some tech found out about our software, installed it, and found it very difficult to beat. They were intrigued enough that they asked us if they could install it inside their server farm. When we took the call, every answer from us was "yes of course" but in reality we had no idea. Credit to Tommy and Erik for figuring out in short order how to make the demo a reality. The first company figured they could reduce their people count from 600 to 60 with our software being the first pass filter. Once we figured this market opp out, we started reaching out to other companies. Long story short, we were looking at deals of $250K per year for our software. Bad timing being what it is, this was all happening around the time of the financing closing. So while Benchmark (wow, that's the first time I have said that name out loud in connection with this story in public since 2003) was moving forward on what they thought was a consumer software deal with massive growth potential, it looked like we had a business opportunity in enterprise-y software for community moderation for companies catering to minors. When Benchmark pulled out (worst kick in the stomach feeling of my life having to pass that news on to the team) we scrambled. The deals from these game companies were coming along but we weren't going to have enough runway to get them closed. The eventual buyers of the company were building similar software, and they had heard our name enough in their calls with their potential customers when being told why they were not being moved forward in the deal that they wanted to buy us. It was a little bit of good luck and timing in an otherwise crap sandwich state of play. To sum up: 1) We knew who we thought our customers were: parents 2) We were wrong about how they would act: parents didn't want to pay for this type of service, despite what they told us 3) We were wrong about the virality of the service: despite saying otherwise, parents wouldn't tell friends they were running this software because of what they perceived as potential social stigma 4) You can sometimes fall backward into your business model 5) Benchmark did us wrong, but that's life. Move on and do great things. Jason, Erik, Tommy and David are some of the most talented people with whom I have ever worked, and I rate IMSafer as the time of my life. We had a lot of fun, and built some amazing stuff (patent filing in case you are interested: http://www.google.com/patents/US20090089417 http://www.google.com/patents/US20090089417) 6) Survivorship bias is a bitch, and there are many stories of smart guys not getting over the hurdle which never get told. We weren't idiots, or morons, or whatever. Sometimes things don't make it. The real question is what did you learn and how to you do something constructive with what you learned. I am happy to answer any additional questions.
hawleyal 14y ago
Sensational headline. TL;DR startups fail sometimes.
JonSkeptic 14y ago
The primary lesson here is as common sense as it is timeless: "You don't have the money till you have cash in hand." Only a fool would sell a house and move hundreds of miles on little more than promise.
pimentel 14y ago
How does that directors and officers insurance (D&O) work? What is the problem with not having it?
erik_landerholm 14y ago
I think I need to clarify what IMSafer did. A lot of arm chair QBs here talking about how's it's evil or that abuse of children in a sexual way just doesn't happen...that could not be further from the truth. No offense (well we know where this is going), but anyone saying this has no f*$%ing idea what they are talking about. What we found in those years with IMSafer and later with the company that purchased our assets was mindblowing in a terrible way. In the US we weren't allowed to really do anything with the data we found even in the most awful cases. When the patriot act was in affect there were opportunities to turn some of the data over to the gov agencies that deal with exploited children, but it was unclear. In the UK they were allowed to more freely use what they found to put pedophiles behind bars...which they did on more then one occasion. In some cases it appeared that children had installed the software as a desperate cry for help against their abusive family members. In one particular egregious case the offender was involved in group chats where he would try to normalize the behavior to his child by having other sick individuals tell her it was OK. Then, they would setup times for her to be online with them while terrible acts were perpetrated on her. No one is acting as if this was common. But, it did happen. And we weren't selling the chat, running ads against it or in anyway trying to monetize the 'fear' or grief of our users. A lot of people here do not have kids and don't understand how hard it is for parent's to talk their kids about all sorts of issues around sex and drugs and rebellion etc. In many cases IMSafer was their last hope and it was very helpful to a lot of people. We never started it because we wanted to spy on kids or know people's gossip. We did it because we realized that parents were ill equipped to deal with the new online world. Porn was a not a concern. To us that was your child viewing something. What we were concerned with was someone coming into your child's world and talking to them without your permission. If the child was having an issue with their parent's these kind of people would pick at that and try to show the child they were on their side to win trust. Places where parent's thought their kids should be safe just weren't and still are not. Also, some kids are susceptible to these kind of attacks by predators. In some cases parent's had kids who had been sexually assaulted in real life already and they were very afraid, because of their child's mental makeup now, that they would make easier targets. We had adults buying plane tickets for kids and working out details to get them to fly across the country to meet under the guise of some camp the kid was going to, etc. It's real whether you want to deal with it or not. We did our best to balance online privacy while helping people. I feel like we did a phenomenal job and we didn't sell fear. It was never part of our marketing or selling.

136 points by sabraham 14y ago

This sounds like the story Jessica Livingston mentioned at Startup School 2012 <http://news.ycombinator.com/item?id=4699862 http://news.ycombinator.com/item?id=4699862 >, if I remember correctly -- business in Texas got a term sheet, moved to California, investors pulled out when their user acquisition metric changed. Anyone have more color on this?

pg 14y ago
Yes, this is the same story.
antonID 14y ago
I thought I had remembered this from Startup School, interesting story.

russell 14y ago

The real lesson is that the money isnt there until the check clears. Selling your house and moving on a promise is risky. Even trying to raise money is a huge drain.

mtaubman 14y ago

Somehow I feel that a more accurate title would have been, "Fail to meet agreed terms, screw yourself".

GuiA 14y ago

The title is a bit disingenuous, but the story is worth reading. Thanks for taking the time to write and share, Jason.

klawed 14y ago
It's charitable to say that the title is a bit disingenuous. I agree that the story (as well as the ongoing discussion) is very much worth reading. The unnecessarily provocative title is only slightly distracting.

thoughtcriminal 14y ago

The title is misleading, immature and in poor taste. If HN moderators had a clue, they would edit it.

mkr-hn 14y ago
You mean the moderators who routinely revert titles to the target page's title when the submitted title is better?
largesse 14y ago
I too am outraged. I nearly lost my monocle.
andyjohnson0 14y ago
If you had the power to edit it yourself,what would you change it to? And why?
- thoughtcriminal 14y ago
  "Misadventures in Kiddie World" Anything is better than what's up there now.

jere 14y ago

As an old teacher of mine used to often say, "Check's in the mail. Love you in the morning."

michaelochurch 14y ago

We went back to other investment firms that we had also received term sheets from prior to committing to Benchmark, but after Benchmark pulled out, the news spread and we had the scarlet letter, or maybe the scarlet zero. This is why VC-istan is dead. (Not actually dead, but "Microsoft is dead" dead.)

jpatokal 14y ago

Let me just quote one bit of that: Our service was free as we were working out the business model. We actually had a genius business model but hadn’t implemented it yet. We wanted more users so we spent money on marketing. Maybe the real problem wasn't the insurance?

batgaijin 14y ago
The money was in the bank, man.
tptacek 14y ago
No, the real problem wasn't insurance; it was that a firm-seeming commitment to fund the company fell through at the worst possible moment. A lawsuit wouldn't have fixed anything for them; it'd have taken years to resolve.
- joewee 14y ago
  They would have been in a much better position if they had actually turned on the revenue model before asking for money. Without that, the only metric they had to impress investors was user acquisition which was dropping.
  - tptacek 14y ago
    Or he'd be in a much worse position, because his cost of customer acquisition was high and the money he'd earn from charging wouldn't come close to covering his operating expenses, and charging would slash his new user signups, which were probably the only realistic lead gen he had to work with. Which is, you know, the situation that gets most people to consider venture capital.
    - jpatokal 14y ago
      Sure, if the "genius business model" was "charge everybody money for it", but the way that was phrased implied they had something more devious in mind. By going the VC route and asking for $7 million straight up, they bet big and lost big.

rdl 14y ago

They (Benchmark, a top-tier VC) broke a term sheet? That is...not awesome.

rdl 14y ago

It looks like failure to get D&O insurance prevented them from suing a top-tier VC for breaking a term sheet, but it's unclear how wise it is to sue a VC over something like that, anyway. BTW, if anyone needs commercial insurance for their (California based) business, I've had pretty good experience with http://www.alliedbrokers.com/ http://www.alliedbrokers.com/ Allied Brokers in Palo Alto, so far. Prof liability, D&O, etc. are all things which are probably worthwhile after a >$1mm seed, depending on how litigious your sector is (b2b, particularly).

jlangr 14y ago

I suspect people who really want to "protect kids" find a way to do it that doesn't involve greed, lawyers, stupidity, and liberally cursing. Maybe there wouldn't be as much need to protect kids were there fewer people who talked about "getting f*cked" or screwed when talking about kids. Jerk.

tptacek 14y ago
As a parent of two middle schoolers, I am a lot less worried about adults using adult language to talk about business than I am about the people who can't tell the difference between that and actual threats to my children.
- jlangr 14y ago
  Whatever. Just another guy who thinks he's owed something because he did something that he thinks everyone should be gushing over.
  - tptacek 14y ago
    Yeah. Stupid guy talking about his stupid life experiences. He should grow up.
- morphle 14y ago
  Please describe these actual threats to your children that you claim. As the first public internet provider in my country we encountered many of these 'actual treats' claims or 'child pornography' witch hunts but we never found a shred of evidence to support them.
vacri 14y ago
Such liberal cursing - saying 'fucked' once. To hell with your overbearing conformance, I say.

tptacek 14y ago

What a shitty situation. But why, oh why, would you sell your house and move from Houston to California before the check cleared? We started Matasano when my kids were pre-K and a a full-day every-day handful, and I had to spend a couple months away from my family while we worked out the move (mine from Ann Arbor to Chicago). I know I'm not the only founder to deal with that situation. Was there some additional circumstance involved here, some other pitfall people should be on the lookout for?

RuggeroAltair 14y ago
I know directly of one case in which one of the terms of the acquisition was that in case of the founder's death within the retention plan, his family wouldn't get the remaining part of the money (which would be given at the end of the retention plan only if he was still alive). This founder, rightly so, thought that it was an awful concept, since his kids needed to be protected exactly in the case of his death. The purchaser said they would have not changed the contract since that was a standard clause and that it was unconceivable to consider changing it. The startup called everything off the day before the deal (even after it was announced), because of this. The clause that was impossible to make disappear suddenly disappeared overnight. P.S. Congrats for Matasano, I am a fan of your company.
- danielweber 14y ago
  was a standard clause and that it was unconceivable to consider changing it The clause that was impossible to make disappear suddenly disappeared overnight Oh, if I had a nickel. Younger readers (and older ones, too) should be aware that this is one of the easiest lies to slip from someone's lips: "oh, that's standard, we can't get rid of it." You need someone experienced on your team -- even if not working for you, a friend you can call -- to find out just how "standard" these things are. EDIT: even terms that really and honestly are "standard" can be changed

homosaur 14y ago

While you made a lot of mistakes here, it's also pretty frustrating that there's a good deal of VCs who are basically only looking for the next Twitter. Why would anyone think viral growth would be realistic for this product? How does one acquire that much capital while knowing so little about business?

brazzy 14y ago
A good deal? From what I've heard, every single VC in Silicon Valley shares this unhealthy obsession over "the next Twitter" (Just read pg's definition of "startup"). And as long as Twitter, Google and Facebook keep paying 8 figure (or 10 figure) sums to acquire "startups" without a business model, VCs don't need to know anything about real business.
- homosaur 14y ago
  Well, I was trying to be nice so the ones that read the forum can convince themselves they are in the good group.

jessaustin 14y ago

Wow that really sucks. In hindsight, could you have hit up your current investors for the bridge round before shopping around the Valley, or would that have put VCs off too?

BrandonWatson 14y ago
As one of my favorite private equity friends likes to say, "a bridge to nowhere is a dock." We were offered some additional capital but it wasn't enough and our conviction was smashed. Until you've been in this sort of situation, you can't know how you will feel or react. Experience is a great teacher.

stuffynoses 14y ago

We received email after email from parents thanking us for saving their children’s lives, literally. Yes, please tell me more about all these children whose lives your service saved. Just like To Catch A Predator's ridiculous premise (that digusting, fat 50 year-old men who live in their parents' basement are hooking up with hot teenagers), yours reeks of trumping up a problem that only exists on the extreme fringe. Literally. one of the partners installed our software. He tested it, he used it, it worked. He got it. He called us and said he wanted to invest as soon as possible. Who is this investor? I want to know because anyone who would vote money on an anecdotal experience like this is an idiot. Your story is interesting, but only when it sticks to the parts about you rushing into an investment without due consideration or self-protection. If you wanted funding, you should've asked Congress for it. They love to exaggerate child sex exploitation as much as your service did.

morphle 14y ago
Indeed, tell us more about these children's lives you saved. I've done extensive research on these occurrences when my first startup internet provider first encountered these claims in the nineties. We never found any evidence whatsoever. We did find an overwhelmingly large number of people ready to go on a witch hunt or lynch these so called perpetrators, but that's been going on for thousands of years now. Has anyone claiming child pornography online ever actually found something? Again, please show us, they would be my first datapoints ever in our assisting of the police in investigating these. The business model of the OP is itself predatory on the fears and underbelly feelings of uninformed parents. Better to explain to those parents how to raise children so that they are cautious about anything they encouter online.
- steevdave 14y ago
  I used to work for a content filtering company. Yes child porn exists, and it's one of your worst days when these sites start popping up in what you're reviewing, no, we can't send the links to others to "prove" it exists. I no longer work there and I'm glad I don't have days like that anymore.
- zurn 14y ago

alphakappa 14y ago

It's a good lesson on how not to make poor business decisions, but the number of times the writer repeated the 'protect kids' phrase turned this into a really tough read. This wasn't a noble mission thwarted by evil VCs - simply a cautionary tale of how not to make startup decisions.

caniszczyk 14y ago

He got lucky that he was able to bounce back.

BrandonWatson 14y ago
Jason didn't get lucky. He's incredibly talented. We, as a team, failed. It happens. I would go to war with any of my co-founders again, no doubt.

erik_landerholm 14y ago

I can add a bit more color to this story as I was intimately involved in it. I worked at the company that was bought by HP in Oregon and then later in Texas. It was called RLX technologies and created the first blade server. After it was purchased by HP I stayed on for a few months before moving on to a startup in Oregon. It seemed like a great idea as they moved me back to Oregon. My best friend, who got me on at RLX after my first startup (NEI: high speed telecom startup) had crashed and burned, had taken a position at this startup in Oregon (we both were from there and had met after graduating from Oregon State). It seemed like a way to continue the work we had started at RLX and would get me back to Oregon. So win-win. Long story short: the startup had issues and he moved on to found IMSafer. I would of liked to but needed to stay on for another 6 months, so I wouldn't have to pay back half of my moving expenses. Once I finally moved on to IMSafer the company was still small with only 6 of us. It was a great time and we built something truly exciting and helpful. We had a wonderful time at the Techcrunch 40…, but that's a story for another time. :) I believe Paul knows this story too, as it was one of the big reasons we got into Ycombinator! I will skip to the end as Jason supplied much of the interesting info and the color to that debacle. But, I will add, just as you don't count your chickens before they hatch you never, never invite your new 'partner' (board member, investors…whatever) to a board meeting until the money is in the bank. Once the assets were sold only 2 of us stayed on with the new company that bought us. It was a trying time, but my best friend did get to move back to Oregon and it was just us, keeping a rather complicated site up and running while working on creating the 'new' product that was to make all the money. While, at IMSafer we had realized that there could be big money in using this software in a more enterprise fashion. We realized that many virtual worlds for kids were popping up and they had use for software like this. He, I and another one of our friends from our old RLX days set out to create a real-time piece to the software that was much better at moderating less dangerous content like curse words, etc. It would quickly mark words they found objectionable and pass the text on to the more complicated software outside their enterprise to look for the truly dangerous things. From the point that IMSafer crumbled to when he and I decided to leave or got fired…depends on who you are asking, we had grown the business to a million dollar run rate in 8-9 months. But, we had been bought by a startup and we had very different opinions on how to run it with the purchasing company…and we lost! About that time we left/got fired we decided to do something new. Both of us had vary different experiences buying a new car and decided we wanted to fix that. After getting in a small fight with our former employees we got them to relinquish all rights to CarWoo! and proceeded to build it. At the time it seemed a bit crazy to fight for something that wasn't much more than a landing page and a bunch of crazy ideas, but in hind sight…seems like genius….I have decided to tell it as a stroke of genius! After we got into Ycombinator we told Paul about this story and at the time he said it was the worst 'pulled funding' story he'd ever heard. It's possible he's heard worse since, but somehow I doubt it. 5 of the 6 of us were married at the time and 4 of us had children. As we were in the tussle over CarWoo!, which was almost nothing at the time my wife had our second child. Tommy and I got our call that Ycombinator had accepted us while sitting in benchmark's parking lot in the spring of 2009. We had come full circle i guess you could say. We moved down to Palo Alto, left our wife and kids behind for the time being and the rest is history.

mratzloff 14y ago

I'm confused. Did they protect kids? I don't remember if he said that or not. Anyway, a few comments: - They paid for free users with no business model in place - They failed to complete requirements of their previous investment deals - Handshakes don't matter, term sheets don't matter; nothing matters until the check clears

rexreed 14y ago
Startups should print out those last three bullets, frame it, and put it on the wall. It would save a lot of heartache.
BrandonWatson 14y ago
We had a business model. We knew when we would start charging. We were already testing pricing when the VC round was underway. We did not get the D&O. That was as much a legal representation screw up than my own failing. I was the CEO, so the ultimate blame lays at my feet. Term sheets don't matter, but one thing that is getting lost in all of this is that we had definitive docs. We had been given keys to the VC office to take up positions as residents until we had office space. Money from other investors was already in escrow. It's not like we got a signed termsheet and moved. We signed the termsheet in Sept, moved through definitive docs until Nov, and it all fell apart in mid-late Nov. It sucked.

yarou 14y ago

I really enjoyed reading this article. More articles like this need to be on HN, rather than the run of the mill startup success stories. It's refreshing and visceral to hear how a startup can fail, being so close to success.

paupino_masano 14y ago

I know how you feel exactly. I had a business in the same position except in the payment industry: we were processing roughly $1m a day until one day we had a frightening call from the bank. Two weeks later we were in liquidation and I was facing bankruptcy. Like you are saying (in an essence): the rug was being pulled from under you. Thank you for sharing your story - by sharing, it it helps the whole startup community :)

Zak 14y ago

Age? Sex? Location? That’s how predators started their hunt. It's also how teenagers started conversations with each other in chat rooms a decade ago. It may still be, but I haven't been a teenager in a while. I imagine predators open with the same question, but actually using it as a filter would produce an unacceptable amount of noise. This is a useful story about some of the mistakes one can make dealing with VCs, but it sounds like the product itself was a little questionable.

altcognito 14y ago
Not really. The default mode is to be skeptical today of anyone online, and that there is no need to provide this information in an online conversation.
mnicole 14y ago
In reading the article and thinking back to being a kid who'd create free-trial Juno accounts and dig through drawers to find the Post-It notes that my parents' AOL accounts' passwords were on just to spend hours talking to strangers on the internet because it was exciting, I have to agree with the notion that this software rubs me the wrong way. This is an issue of parenting; you can't just turn on an app and expect it to do your job for you. Kids won't be dumb if you treat them with respect and show them what can happen if they don't keep their eyes peeled. Like the ridiculousness of the Dateline conversations, it was always very obvious when someone was creeping on me and it only took one click to block them. Allowing my already-fearful and ignorant parents to read random snippets of messages I was sending and receiving - particularly because a lot of our ASL?? comments were jokes to begin with - is a violation of my privacy and trust. Growing up in an environment like that would have completely shifted not only the way I use the internet today (especially if they'd gone ahead with their plans to implement it in social sites for kids), but would have affected my relationship with my parents in ways that would have left me hesitant to be myself at all. Worse, when my cousins reached those ages at around the time this company was starting, social mediums had progressed and their problem wasn't talking to people online; it was posting very promiscuous photos and embarrassing YouTube videos showing the inside and outside of their homes and not putting any privacy barriers up. Those are much bigger concerns to me than knowing how to deal with stranger danger in text communications.

aaron695 14y ago

Lol totally evil product based on making people lives awful through fake fear. But I guess that's many successful products, make people feel bad or their lives are missing 'something' and give them the solution for the $ Myself and friends have often talked about it. Be unethical but make money. Individual vs Herd mentality. And in the first world is it really that evil to fool the people who fall for it? I find it hard personally but maybe that's a weakness I should train to get over, not sure. I do give a % of my wage to 3rd world charity so would I still be up positive ethics wise. Interesting article to see into that world anyway, something to think about.

Tichy 14y ago

"For almost two years they had been personally liable for what me and my friends were up to." I don't understand this part. Shouldn't the investors have seen the insurance through themselves? It seems mad to rely on other people for that kind of thing. Sure it would have been nice for the startuppers to organize it, but really, it's a no-brainer that for such things you have to organize it yourself (because the people tasked with it have no real stake in it).

jiggy2011 14y ago

Doesn't sound like they had any idea how to make money off this thing. Since for whatever reason they decided they didn't want to charge any money for the service. What could they have done to make money from children's internet chat logs that would not be in some way shady?

rexreed 14y ago

Talk about counting your chickens before they hatch ... and not just about the part where they moved or added a board member before the money hit the bank account, but even the little "celebration" in Vegas. How is raising money a reason to celebrate in Vegas... especially when it hasn't even hit the bank yet? While I feel bad for the founders here and the VC behavior is deplorable, a little cautiousness and common sense would have really saved the day here. "Let's not move until the money is in the bank, ok? Hey board member -- just step back for a few minutes until the wire clears. Once it does, we're all yours." ... All that being said ..... BIG KUDOS to the team for getting the investors their money back: "We sold the assets for what our original investors had put in to the company, about $1.5 million, so we were able to give them their money back." That's great -- I know very few entrepreneurs who have gotten well past the point of raising capital who can claim to have returned investor money. So, while you might have gotten the Big Screw by VCs, in part due to their shadyness and in part due to your own over-enthusiasm and lack of diligence, I think you saved the day for your investors. They may not invest with you again, but they can't say they lost money with you either.

appleflaxen 14y ago

A bit off of the main point, but > Age? Sex? Location? That’s how predators started their hunt. And how non-predators start their hunt (the same way that predators in the 1800s started their letters with "Dear Timmy"). It's a completely nonspecific starter question for anyone who is chatting with a stranger, and I wish the author were more careful with this.

DanBC 14y ago

Perhaps there's a niche for software that alerts the children and not the parents when they're triggering certain flags. "Do you really know this person AFK?" "How would you feel if this photograph was sent to all of your teachers, and everyone you know in school?" And before people mention MS Office's Clippy - yes, it was was awful, but part of the reason for that was kludged implementation. (http://robotzeitgeist.com/tag/bayesian-inference-engine http://robotzeitgeist.com/tag/bayesian-inference-engine) This new implementation could have a "spy on your children" feature, but allow that to be turned off for the parents that find such things troublesome, allowing the warnings to go direct to the children.

BrandonWatson 14y ago

When Jason sent this to me as a preview, I did not think it would end up on HN. Interesting. I want to respond to a few of the comments, as I was the main protagonist in getting this idea off the ground, CEO of the company, and the business/product guy surrounded by the talented engineers who made this happen. The decision to invite the board member on to the call the day before the money was in the bank was my call. My biggest mistake of my career. I have learned from it, but it was my call and I blew it. Nothing about the situation gave us any reason to believe that we would have a problem. By the way, if anyone wants a front door key to a tier 1 VC firm, I am sure one of us still has theirs. On the topic of the business model. Let's first talk about the derivation of the idea. Having spent my career in tech and Wall St, I have seen the migration of high IQ talent into spaces where the marginal utility of IQ was trending to 0. We wanted to find an opportunity where we could be smart and do new things, and that would, theory lead to money. The base thesis here was that no one had made money in the kid protection space for a while. IQ follows money. Viola. We were right - there had been no innovation in this space in a long time, and everyone was focused on keeping porn off computers. We decided to try and focus on keeping bad guys from getting to the kids. We can all have an intellectual discussion about whether this was an overblown social issue or not. I don't feel like rehashing that here. What we did know is that we had a novel approach to solving this language problem, and we built an engine. We did not solve it with Bayesian analysis or ML. We went a different route, and the engine was very effective. Our premise was that we could sell the software to parents. We did all the things many of you would do. Built an MVP (before there was a phrase for it), talked to customers, etc. It turns out that the axiom from real estate is true here. People lie. What parents said they would pay for, and how they reacted when using the software were totally different. Many of them expected the software to come with a computer, or be paid for by someone else. They told us they would pay for it, but in reality they expected it to come from an AV provider. That never would have surfaced in talking to customers ahead of time. We then pursued a deal with McAfee. I don't know if at this point in time I can talk about that deal or not, but suffice it to say, that wasn't the golden ticket. After spending time refining the business model to get parents to pay, we (as many companies do) fell backward into our business model. It started with a fortuitous call from a large company making a massively multiplayer game for kids. It turns out many of these companies who cater to kids have rooms full of moderators for in game chat. People are very expensive. Some tech found out about our software, installed it, and found it very difficult to beat. They were intrigued enough that they asked us if they could install it inside their server farm. When we took the call, every answer from us was "yes of course" but in reality we had no idea. Credit to Tommy and Erik for figuring out in short order how to make the demo a reality. The first company figured they could reduce their people count from 600 to 60 with our software being the first pass filter. Once we figured this market opp out, we started reaching out to other companies. Long story short, we were looking at deals of $250K per year for our software. Bad timing being what it is, this was all happening around the time of the financing closing. So while Benchmark (wow, that's the first time I have said that name out loud in connection with this story in public since 2003) was moving forward on what they thought was a consumer software deal with massive growth potential, it looked like we had a business opportunity in enterprise-y software for community moderation for companies catering to minors. When Benchmark pulled out (worst kick in the stomach feeling of my life having to pass that news on to the team) we scrambled. The deals from these game companies were coming along but we weren't going to have enough runway to get them closed. The eventual buyers of the company were building similar software, and they had heard our name enough in their calls with their potential customers when being told why they were not being moved forward in the deal that they wanted to buy us. It was a little bit of good luck and timing in an otherwise crap sandwich state of play. To sum up: 1) We knew who we thought our customers were: parents 2) We were wrong about how they would act: parents didn't want to pay for this type of service, despite what they told us 3) We were wrong about the virality of the service: despite saying otherwise, parents wouldn't tell friends they were running this software because of what they perceived as potential social stigma 4) You can sometimes fall backward into your business model 5) Benchmark did us wrong, but that's life. Move on and do great things. Jason, Erik, Tommy and David are some of the most talented people with whom I have ever worked, and I rate IMSafer as the time of my life. We had a lot of fun, and built some amazing stuff (patent filing in case you are interested: http://www.google.com/patents/US20090089417 http://www.google.com/patents/US20090089417) 6) Survivorship bias is a bitch, and there are many stories of smart guys not getting over the hurdle which never get told. We weren't idiots, or morons, or whatever. Sometimes things don't make it. The real question is what did you learn and how to you do something constructive with what you learned. I am happy to answer any additional questions.

hawleyal 14y ago

Sensational headline. TL;DR startups fail sometimes.

JonSkeptic 14y ago

The primary lesson here is as common sense as it is timeless: "You don't have the money till you have cash in hand." Only a fool would sell a house and move hundreds of miles on little more than promise.

pimentel 14y ago

How does that directors and officers insurance (D&O) work? What is the problem with not having it?

erik_landerholm 14y ago

I think I need to clarify what IMSafer did. A lot of arm chair QBs here talking about how's it's evil or that abuse of children in a sexual way just doesn't happen...that could not be further from the truth. No offense (well we know where this is going), but anyone saying this has no f*$%ing idea what they are talking about. What we found in those years with IMSafer and later with the company that purchased our assets was mindblowing in a terrible way. In the US we weren't allowed to really do anything with the data we found even in the most awful cases. When the patriot act was in affect there were opportunities to turn some of the data over to the gov agencies that deal with exploited children, but it was unclear. In the UK they were allowed to more freely use what they found to put pedophiles behind bars...which they did on more then one occasion. In some cases it appeared that children had installed the software as a desperate cry for help against their abusive family members. In one particular egregious case the offender was involved in group chats where he would try to normalize the behavior to his child by having other sick individuals tell her it was OK. Then, they would setup times for her to be online with them while terrible acts were perpetrated on her. No one is acting as if this was common. But, it did happen. And we weren't selling the chat, running ads against it or in anyway trying to monetize the 'fear' or grief of our users. A lot of people here do not have kids and don't understand how hard it is for parent's to talk their kids about all sorts of issues around sex and drugs and rebellion etc. In many cases IMSafer was their last hope and it was very helpful to a lot of people. We never started it because we wanted to spy on kids or know people's gossip. We did it because we realized that parents were ill equipped to deal with the new online world. Porn was a not a concern. To us that was your child viewing something. What we were concerned with was someone coming into your child's world and talking to them without your permission. If the child was having an issue with their parent's these kind of people would pick at that and try to show the child they were on their side to win trust. Places where parent's thought their kids should be safe just weren't and still are not. Also, some kids are susceptible to these kind of attacks by predators. In some cases parent's had kids who had been sexually assaulted in real life already and they were very afraid, because of their child's mental makeup now, that they would make easier targets. We had adults buying plane tickets for kids and working out details to get them to fly across the country to meet under the guise of some camp the kid was going to, etc. It's real whether you want to deal with it or not. We did our best to balance online privacy while helping people. I feel like we did a phenomenal job and we didn't sell fear. It was never part of our marketing or selling.